The world’s largest steel trader, Duferco International Trading Holding, confirmed Tuesday it will sell a majority stake to China’s Hebei Iron & Steel Group. The deal is valued at approximately $400 million according to China News Service.
The agreement, signed on Tuesday, is aimed at enhancing the ability of China’s largest steel company to sell steel in foreign markets. The purchase will increase Hebei’s current 10 percent share in Duferco to 51 percent.
“Hebei Iron and Steel will fully utilize Duferco’s international reputation, management and experience to improve our efficiency and competitiveness in international markets,” said Hebei chairman Yu Yong.
Chinese apparent steel usage is expected to post 1 percent growth in 2014 according to the World Steel Associate and decline to 0.8 percent in 2015. The agreement will help Hebei increase exports to offset decreased domestic demand.
“I am delighted that we have concluded such a significant agreement. The center of gravity in global steel has long since shifted to Asia and this partnership will provide us with unparalleled access to an essential region for DITH and the industry as a whole,” commented Matthew De Morgan, CEO of Duferco Trading.
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